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tv   Fast Money  CNBC  September 18, 2009 12:00am-1:00am EDT

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live from the nasdaq marketsite, this is "fast money." i'm melissa lee. stocks are trading from 11-month highs. is this the end of the ride here? these traders have your ways to protect and profit regardless of what's going on. also tonight peter schiff joins us live just after entering the connecticut senate race this morning. you will not want to miss his economic plans for the hill. plus, obama scraps missile shield causing tim seymour to fire away on the trade today. we'll review what it is a little bit later on the show. but before all of that, get to palm's wild ride in the after-hours' session. right now take a look at the chart. earnings came in better than
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expected. second quarter forecast was a bit light and the company announcing news of a secondary offering. you see that iguess, moved lower and then higher. >> volatility. >> yes, it is. thank you very much, joe. i was scratching for that word, volatility in the after-hours' session. go straight to jim goldman, he's our silicon valley bureau chief, he's going to break down the numbers. what's going on? >> reporter: volatility is absolutely the magic word here. saw these numbers come out, palm took a dip and mostly because of the 16 million shares, secondary offering. talking about significant dilution for shareholders. palm shares turned positive and it looks like people are more concerned about dilution. talk about them quickly here because palm did report a dime a share a loss, and that was substantially better than a quarter a share loss that wall street was anticipating. nongap revenue. way better know that the $291 million that wall street was looking for. but the real story here comes in shipments and cell through. palm basically ship shipped 823,000 smartphone units. that's almost double some of the estimates that i saw, and i got to tell you, mike bromski, a good friend of your show, was way out there. and there was absolutely some snickering just how optimistic
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and rosy he was earlier this week and he was right it's money here. even a little light with his estimates. and he's taken a victory lap tonight. you can be sure of that. the cell threw, 810,000 units. way better than wall street was looking. 27.9%, substantially better than the 25% change and last quarter. this is a very good report. but the interesting part here is cash went down to $211 million. you know some thought that this number would be over 230 million on the quarter. palm secondary offering becomes absolutely key for this company. it needs cash. it needs to continue marketing the pre. but all in all, it looks like people are actually buying this
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product and in droves. this is pretty good news for these guys. >> jim, certainly the first quarter looks good but it's the second quarter forecast that's concerning the street. to $272 million in terms of its forecast. and had that sort of suggests what wall street had been concerned about, and that is slowing momentum when it comes to selling the pre. i mean ucannot ignore that, can you? >> reporter: no question, and what i have been saying since the pre -- since we first started talking about this thing back in january, is the proof is in the sales, the proof is in market penetration and market sustainability. and that's been the big issue with palm. if this company was able to report really good numbers for its fourth quarter, where the pre was only around for a week, then the question is, this right now, the first quarter that the company is reporting today is the first real quarter where we can see pre sales and pre market performance. if this company cannot sustain this beyond a quarter or two, palm becomes an also-ran and those $25 on the street become a joke. the big ramp up that we've seen in palm shares this year you know becomes a history lesson. >> got it, jim. when is the conference call
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start? >> reporter: right now. >> all right, we'll check back with you later. thanks so much, jim goldman. >> reporter: sounds good. >> and certainly the forecast, that is what credit suisse. beyond what who knows. we don't know if there is any sort of momentum when it comes to the pre. >> the next step for these guys. they're in the game but they've got expand their distribution. they have a lot to prove here, i think. and again, that's why i don't think the stock's being rewarded here. i think that the people need to see the proof in the putting. >> i think it's a -- that's the problem here. the najarians can buy an extra 200,000 to boast up the preshays ship. >> they're nokia. not take them up in the nokia. >> i know. >> it's small it's so unbelievable. >> how about the pixie? >> i don't know what the pixie is. >> those big mitts you have.
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but if you are long the stock right here you have to question, you have to ask yourself, why remain in the stock going forward, what is exactly going to be the catalyst to move it higher. >> i think a couple of things that you could look at. i think that bromski is right on. his target is $25. the growth that he's talking about if they can ever get out of their deal with sprint, that's hanging over this stock right now is people think that distribution network is just not enough through sprint. they think they ought to go to verizon, they think they ought to go to at&t and build up something for themselves and at some point they likely will. and that's the reason i think that you could still own palm. by the way, the volatility in the front month today, absolutely extraordinary. exploded over 200% setting up some trading where you could buy the october, sell the september. something to keep an eye on for the next time around. because when you can get to that kind of a huge distribution of those volatilities, that's incredible. >> i want to take a positive conference, bring your attention to what is on the bottom of your screen and that is the securities exchange commotion voting 5-0 to propose banning flash orders.
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widely expected. keeping you updated on that situation. but turning back to the palm conversation, certainly an interesting one to have on the day that apple hit a new 52-week high during today's session. in the first two weeks were much greater than the sales in the first two weeks of other operating systems in the past. so that is -- >> no leopard. >> real quick to get back to the palm. a lot of calls for the $25 in palm, it's built upon the premise that palm's going to get taken out at some point. so it's all about that potential m & a activity and somebody coming in and scooping them up. pete, i agree with you that there is a way to stay in palm right now by owning puts on the decent market. it's very cheap to do so but fundamentally, again, if you don't get that m & a activity, this stock can roll back over, just as quickly as it rallied. >> taken off the take with the news of the secondary offering? they wouldn't be raising money
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right now would they, if plan on being bought. >> no. >> right, it's gone. >> yeah. they wouldn't be doing it right now. i don't know how pressing their cash needs are at the moment so -- >> right. they're pressing. >> they are. >> that's been an issue facing for a while now. >> let's get back to the market overall today. take a look at the chart of the day. in fact, we show you this because in the past in the s&p 500 has moved up 20% above its 200-day moving average. it has meant trouble and as you see there we are at that point right now. some pundits including art cashman out there, doug cav, our friends, they note that the last time this happened 1983. we had a nasty, nasty sell-off when the s&p 500 was 20% above its 200-day moving average. >> well, technically we're in a very difficult place and where all of the people that come on our show including the guys with us. will tell you this is where the technicals count. if you look at the rsis, in other words, the relative strength indicators or the guys who followed the marks.
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tom demarks active. a lot of signals in the markets technically saying these stocks. apple i think looks scary at these levels looking at pure technicals. that's what this is about because the data continues to be strong. the reason those other pats rallies have told major downclines is because we ran into very difficult dat here. i think this is a classic case. today was a technical -- it's a breathtaking and it could happen for a couple of more days but it will be shallow and won't be much, i can tell you. >> this was hardly a big pause to refresh. >> no, not at all. >> if you look at the volatility index, it was actually lower today. which is -- you would think, it would maybe go a little bit higher but it is -- i think it's more of the same. this money that's just so afraid sitting on the sidelines and as the end of the year approaches you've got to catch up to the benchmarks seen in we're also finally above the 400-day moving average, that accomplishes all of that bad price action from this time last fall. if you are a long-term player looking at market that is positive for the market that we have elevated above that level and now joined a lot of the foreign equity indexes that did it. >> how did you get this 400-day
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moving average? i am sure a lot of folks out there will say, hey, joe, we never looked. it is day two, move on. >> i will tell you the story so pete, karen, tim i and yourself can make fun of he me. yes, i was on the beach, playing football on the beach. >> make fun of you. >> a hedge fund manager came over to me, had a conversation with me. he was very bearish on the market. he told me until the market clears, the 400-day moving average and we join the chinese markets the brazilian markets, which already done so, no conviction that the market rally would move higher.
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and no, he didn't have a speedo on. >> you know where there is not conviction, no conviction out of sellers. what happened today, technically, it looked to me like a trader's market once again. the market goes up, those are the short-term traders. they're taking some off but you didn't see the pressure on the downside. we started to pull back a little bit, absolutely no selling continued the rest of the day. look at volatility indexes, karen points out, trading around that 23 level. expected move, 15, 16 points. what did we get today? about 15, 16 points. it is perfectly measured right now for the moves that we're getting and the protection is in place to the downside. so you're looking at it, and technically we're not breaking down because tav. we need a massive gap before we can get through those levels. >> what happened today with ge put, pete? we saw ge rollover midday or so. ge is a major component. and that seemed to be the tell for the markets today. >> believe it or not, ge today was much lighter volume than yesterday. >> really. >> this yesterday this thing traded over 2 million. >> it's been two times this sunrise yep. the volume's off of the charts, both the stocks and the volume, absolutely inkrebl. today a little bit lighter and i testimony you what wasn't that fear factor because of the fact that most the activity over the last couple of days has been swayed towards the calls. these are not people in that panic to get out because they're not owning the stock. they are owning these options to the upside. >> right and if you look at the overall market itself today you would also look at what i like to call the hedge fund vip list, i know that goldman sachs references that as well but the names like google, the names like apple, the names like caterpillar and you look at goldman sachs itself and morgan stanley, all of those names, those names were still hire today so you did not have this rollover that i think a lot of
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people are fearing in the market right now. the market look good heading into option expiration. >> move on today. happened to the chart today and that was financials. citigroup and morgan stanley up five. while financials as a whole declined. citigroup interesting note. saying -- rockdale. everybody knows who we are talking about. dick bove. essentially he's saying that it does not look and although overtures to the fact it does not look like the treasury is going to in fact unload its stake anytime soon and nor does it looks like citigroup is in any sort of rush to raise capital. he's talking about five bucks a share. >> here they are raising $2 billion at five-year notes without fdic backing today. that's what the market loves and that's the beginning of the follow-through. their claims that, yes, we can succeed without the help of the
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government. this is the first step. it may in fact be. i would be of the opinion if these guys to get their bailout or pay back that money anytime soon would that be a huge mistake and it would send a very bad message tie lot of people that all banks are going to be backed up and bailed out from here to eternity and be allowed to get out easy and i don't think the government's going to let them for that very reason but it was very positive that they were able to raise that money. >> would you touch citi, karen. >> no, because i really don't know what -- you don't know what the business is going forward. the good yield curve. and lower nonperformance. >> you can look at bank of america, i love that name. citi is basically an option right now. when you looking at the stock price options it's a nonexpiring option, i mean, why is not looking for any kind of a bottom-picking area and that's what i single some of the driving force over the last couple of weeks in that stock as well. goldman sachs, morgan stanley, a lot of that to do with the pin risks because of the fact moving towards those bigger area was the stripes of the bigger interest. jpmorgan. when came out with a $58 price
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target. that was impressive. talking about failures not as big of a concern so he's pushing up jpmorgan. love that name. i agree with him wholeheartedly. >> these consumer debtholders you look today, talk about, household network up $2 trillion, quarter on quarter. that is the first quarterly increase we have had since q3 of 2007. so the balance sheets of the consumer are getting a little bit better. >> right. let's move on to another stock topping the tape today and that is amr corp. company american airlines surged 20%, be a to raise $2.6. news of eastman kodak managing to raise private equity cash. and karen, you're also noting blockbuster also. everybody's raising money, taking advantage. >> first it was going to be 340 and they nearly doubled the size. it is amazing to be to me, if you look back not so long ago, each of these deals would had been impossible. wouldn't have even left the drawing board and then all three of them got done successfully is
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kind of amazing to how quickly the debt markets have recovered. >> i think in the caves the amr deal though. two people that desperately needed for a business. leasing them back. it's a very positive deal for them but it's also very good for amr. and i think if you look at citi bank they lent them a billion dollar, prepaid for -- i don't even know the number. i think that's the point. people don't exactly know the details of this deal yet but it may had been very good for citi bank, bailing out amr, going into a season where they have run into significant cash flow needs. so it's very bullish for amr. they're claiming it's a show of strength. i think it's a show that there's other guys that are relying upon their business model to help them over. >> and once again pushing into the boutique firms and into the financials. look at palm tonight. that was jpmorgan, it's rbc,
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it's morgan stanley, all involved in all of these various areas. we're talking about 40 million shares one day, 18 million the next. >> right it all adds up. >> 16 million. these are adding off and a huge margin area for the financials. >> hitting gains just yesterday with the dollar continuing its downward spiral. dennis gartman, he's the commodities king and also of the gartman letter, for more on this one. dennis, always nice to see you. >> always good to be here, thanks. >> you continue to say that gold is an overpopulated trade even as we see gold continue to tick higher and higher and higher. >> oh, it's unbelievable overpopulated but it does continue to tick higher and higher and higher. i continue to be bullish of gold but i'm not eye don't own it in dollar terms. i own gold in terms of sterling, i own gold in terms of the euro because i'm afraid if the dollar were to suddenly get stronger, because that's truly the overpopulated trade, that's where everybody is short. that's what's helped gold go up. in the way i trade i want to be long gold but at the same time i'm short euros and short sterling. and that's actually been a very good ride.
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>> go ahead. >> i was going to say, dennis, what do you being in the valuations here at the gold miners. suddenly these guys are not very cheap even if you believe these guys. can start to value gold spot prices. 27. this scares me a little bit. i'm just curious where you are headed. >> i'm as frightened as you are. we are getting into terrible nose bleed territory on all of these things but you can't be short of them. they still want to go higher, the trend is still up and as a like to tell people in a bull market there's only three positions that you can -- really long, long or neutral -- perhaps there's a time in the gold miners to be neutral. if you are going to trade gold, trade dld. it's pure bet on the gold market. with miners you're always worried about strikes, you're worried about a mine closing up. >> yep.
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>> you're worried about water in a mine. i prefer owning the gold itself. >> dennis, ask you a question. etf to hit the market yesterday. a lot of these etfsent on physical commodity in some vault in this planet. is there concern that if the momentum gets sucked out of gold a run to the exits of some sort, and not be those gold buyers sitting in the vaults around the world. >> know in the market anywhere is when the door closes suddenly it gets very difficult for everybody to get out. eight, we actually have eight gold atfs golly, if that's not overpopulation, i don't know
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what is. i had no idea that we the eighth gold etf come to the market yesterday. i am a little concerned. what i can tell you is the number of request that i get to to do interviews whether or cnbc or bbc or canadian broadcasting or whenever or from the media, the news media, when the number of interview requests come in and get on very high levels and they are right now in our and i think you're taking a look at next year, knowing what soybean prices are now compared to corn prices there is going to be more soybeans planted next year which means less nitrogen being used because of the decline in cotton -- or the corn production. >> hey, dennis -- >> i think that's what put potash down but today it went
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up. i covered, i got out. >> dennis, let me ask you -- dennis, it's joe. >> hey, joe. >> look at commodity tape right now it's a little bits of a mishmosh. one of the best performing commodity it is this year has been sugar, up 69%. >> you. >> i know that you've been bullish and i've been bullish and i think that both of us will remain bullish throughout 2010. >> yeah. >> how do our viewers play that trade? how do you play sugar rallying for the next 12 months? >> well, to be honest, given what has happened because of the problems in the indian crop and the lack of a monsoon, no need to get into too many the fundamentals but that's what's driving it higher, if you dopt it obviously you buy the sugar futures. that's the way. be careful, it's extraordinary volatile. if you want to do it i think the sophisticated way is to buy the front month sugar, settled back that market goes into backwardation as the supply tightens but the sugar futures is the place to go. ipsu, which is a large sugar manufacturer here in the united states. >> brazil, biggest.
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>> absolutely. >> the most benefiting from the reduction at the desk. that's the good play. >> dennis, always a pleasure to speak with you. >> thanks for having me. >> dennis gartman from the gartman letter. don't go anywhere. trades on the way including a bizarro energy trade. how to play rush after obama's missile maneuver and the latest in palm after hours. stick around. congress may not know what hit them when senator schiff drives into the capitol. the candidate announced today on his plan for the country's economy. and he saw the global economy grinding to a halt as others were betting on an international boom. a top strategist on what we need to get back on track. and plus are unions good or bad for shareholders? the chairwoman studies the fine print, gets answers from her exclusive interview with the biggest name in big labor. ♪ she loves you, yeah yeah yeah! ♪
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training globe. president obama reeling back. and instead opting for a new system, he says, is better equipped to fend off an iranian threat. >> our new missile defense architecture in europe will provide stronger, smarter and
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swifter defenses of american forces and america's allies. it is more comprehensive than the previous program. it deploys capabilities that are prove and cost effective and it sustains and builds upon our commitment to protect the u.s. homeland. >> it could be a big thing because it could chill inauguration relations between china and russia who had opposed the bush plan. >> the nuclear threat is debatable but russia and the u.s. relations based upon an acrimony between bush and putin and not budget engaging the kremlin in major decisions that involve nato up in their backyard with you know remnants are painful memories for the soviet union. look, bottom line, a lot of russian risk built into stock. you remustsovereigness because medvedev who is in control in russia begins to engage obama in a way that's more constructive
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you will start to see outperformance in russia. so when you are playing russia in the new york stock exchange you're talking about -- you're talking about mbt, mobile telesystems. metro mtl. another major coke in play. these stocks all have in their valuations additional risk attached to russia risks. so if you start to see friendly rhetoric, russia will outperform. russia is trading cheaper than the rest of the asset class right now. it has its problems. i'm not going to run from that. it does have its political risk but this is very bull fish you are investing in russia because i do believe it's part of a trend towards better relations. >> hold along a little bit of crude oil when ied there story. the reason being october 1st the iranians sit down with six other
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nations, including the united states, discuss the iranian situation. i got to think the israelis are not too happy about that development, nor are they too happy about the development today with the obama administration. good reason to be long oil, my opinion. >> okay, let's move on here. one year after lehman brothers collapsed we're talking this week to some the few who foresaw the term oil. merrill lynch's chief investment strategist at the time. here's what richard bernstein told cnbc in december of 2007. >> one of our major themes for '08 is to stay away from valued traps in the united states. and we think the financial sectors and in some consumer cyclical areas are probably in that category. terms for 2008 support be sort of global growth, it should be global slowdown. >> richard bernstein of richard bernstein capital management joins us on set. richard, always nice speak with you. >> thank you. good to be back. >>prechtly back in 2007. what are the value traps today, are they the same as before. >> no actually we're the part in the cycle where you want to be more of a valued investor. if you believe the economy's going to recover, if you believe recovery in profits over the next year, year and a half, that's the prime time to be a valued investor. growth investing tends to work as the economy slows down. >> what are the pockets of value that you've seen in the market
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today. >> what generally happens is the junkiest companies, the companies that you would just hate to own will perform the best. and that's actually what you've seen so far this year. where people have lamented that the junky companies are up 60%, 70%, 80%, 90% and that's a sign of risk. that's very normal. it's a sign that the market is beginning to sense the economy's actually recovering. in almost every industry i would argue go for the lower-quality companies right now. >> your saving to invest in the junky names. >> in the junky names. >> run up so far. >> that's perfectly normal. that's actually perfectly normal. >> with the run-up of multiple hundreds of percent. >> yep, back to 1991 in the time period that's sort of similar going through right now with the financial crisis and everything, 1991, c & d rated stocks by standard & poor's went up over 90% that year and it continued to outperform for another four years after that. >> but isn't the valuations in these companies in that first round of the rally more dependent upon in improving balance sheet. the most leveraged companies, the most priced possibly for bankruptcy. >> yep. >> and default risk. haven't we lifted that off of these companies that the point? or lifted that -- some of that
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risk off, but left with the same poor balance sheet, underperformance by management, and therefore, how did these stocks take it to that next level? i would think where i would want to be rotating into the good companies. my thing is assumption is the economy continues to get better. watch the employment statistics for that. the leading indicators in employment if they rollover you don't want to be in low-value-ori don'ted companies. you want to be in the higher quality once. assume for a second that the employment continues to improve. if that happens, what you get is a shift from focus on balance sheet to focus on income statement and cash flow. and the junkiest companies have the greatest operating leverage, the most sensitivities to the economy, and so their cash flow just explodes. again -- >> what do you like here? who is number one on that list right now. >> i don't have an individual. one thing that people are probably shunning -- or still stay away too much is probably consumer cyclical stocks. the ones that probably have tremendous upside potential here if employment continues to improved. >> okay richard, do you use derivatives at all? as an options guy talk about chasing the junk, would you protect this, junk chase on the way up? >> i'm not a derivative's players so i'm not qualified to talk in that, but i will say
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that i think people always underestimate that the point in the cycle, how long that quality is and how long it lasts. again you have to make the assumption the economy's going to know to improve. >> richard, thank you very much for your time. >> sure. my pleasure. >> richard bernstein of richard bernstein capital. move to our prop desk. under way in some energy stocks. over the last week or so, oil's traded physically dead flat. refiners though taken off, valero up 12% since friday and today was its biggest intraday move higher so far. joe, one that you've been following. >> a great segue with what richard was talking about when
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you look at sectors, industry, they were priced for armageddon. guy adami and jon najarian all over the hotel story. look at the refiners clearly priced for armageddon. beginning to be unwound right now. the refining space is somewhere that you want to look at. margins are beginning to improve in both distillates and reformulated gasoline. reform latesed gasoline if you look the at energy complex, reformulated gasoline is the best-performing energy right flow. it may be a little bit of a head scratcher, not so much. refiners through the end of the year may be just the best energy player. >> and that's an area where we've seen incredible amount of option activity. last couple of weeks frontier oil a week or so ago that stock's shot to the moon and today it was western refining. incredible option activity out there today. as a matter of fact pushing off to december. a stock that's lagged the rest of the refiners. the rest of them moving up 10%, 15%. this one has stayed behind a little bit. maybe it's finally ready to crack out of of the range it's been trading in around 7 1/2. an area that's been very difficult. october 17th, december 17th. december 17th today, 18,000 of those traded today. so a big bet going out that this stock's going higher.
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>> credit suisse had a great report coming out. if you look at what is strange about this though is the crack spreads or ecertainlily the profit margins for these guys they're in terrible shape and so, yes, i think a lot of these refiners have been -- sen occo. i think that people have expected the worst but their profitability has still not gotten better. it's dependent upon an increase in gasoline demand which we haven't seen. >> they do have those levered balance sheets. snow crack spread does move, it's a lot of upside. >> that's a good point. let's see what was going on around the floor today. hm? farmer, kevin skinner. aerosmith. nbc. called in the top five for the million bucks. you know what he -- you know what kevin skinner does for a living? >> what does he do? >> what does he do? >> chicken catch. >> what? >> a chicken catcher. >> i have wrestled tim. and i can tell you what you can wrestle these son of a guns. thedeserves it. keep an eye on the refiners. >> sticking with the chicken right here. >> it seems very natural. >> when you were talking about that i thought that's where he won for was chicken catching.
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>> that should be a challenge on "america's got talent." >> i got it now. >> a great point. >> good talent. >> i guess. >> keep loosening up the grip on that chicken. >> i tell you i got to wring its neck. >> whoa, whoa, don't choke it. coming up next we saw him on cnbc back in 2007 warning that a market collapse was imminent. now, subprime civon and youtube star peter schiff is running for the u.s. senate. he tells us what his platform is right after this.
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welcome back to "fast money." here's what we've got coming up for you in the second half of the show. one "fast money" fan wants to know to if citi is heading back to five buck a share this is we've got your answer out there. popped today. do you buy this down? plus, with the labor-friendly president in the white house, it is time to start asking, are unions bad for shareholders? the chairwoman sat down with james hoffa, the president was teamsters, and brought down an answer in a cnbc exclusive.
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well, first, first we hail to the chief. if you don't know. the president's theme song and what he plays before the bed at night. these days perhaps. peter schiff the candidate. joins us now. you know him as a bearish voice on the u.s. stock market. what is your message to your constituency? people in general don't like to hear bad things about the u.s. economy, peter. >> unfortunately they're going to have to authority because bad thing are going to happen. as a tried to explain the last time on your show the real economic crisis is not in our
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past, it's in our future and it's coming soon. and the reason i want to go to washington is to really prevent the worst-case scenario from actually playing out. >> how? >> well, hopefully i can educate the other senators, the other representatives, maybe even president obama that they're the source of our problems. and what they've been doing over the last year is throwing gasoline on a fire. >> peter, you come on our show quite often and other shows on cnbc. you have that chance to educate people in congress as well as educate the president. but when you're actually there, what will you do beyond education? >> yeah, don't know how many of them are watching me on cnbc. >> hey! >> i think if i'm on the set of the floor they're going to have to listen to me. i think they have something called the filibuster there so i'll probably be using it, but, no, i think it's very important. i think this -- this crisis is going to progress. it's going to get a lot worse in the years ahead. the reason no real recovery coming. the economy is going to get worse. unemployment is going to get worse. inflation is going to run out of the control. interest rates are going to spiral higher and somebody has to be in the congress to actually explain to the other representatives why this country's in so much trouble and what has to be done in order to enable all of us, individually, will enable the market to some of these problems. >> the third time i will ask
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you, what needs to be done. >> shrink government instead of expanding government. we need higher interest rates, not lower interest rates. we need the americans to save their money. we don't want to encourage them to spend more money. we want to pretty much get rid of consumer credit so that businesses can have access to credit. we want businesses to borrow money to make stuff and employ people. we don't want consumers to borrow money to blow it on consumption and certainly do not want to grow government. government is enormous. the economy is already in bad shape. we cannot afford trillions more in government spending. do the opposite whether we're doing. we need to abolish government departments, shrink agencies. bring the budget back into surplus. >> all right. so where should the interest rates be? >> much higher. >> okay, what, 5, 6, 7? >> i don't know but it's not up
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>> i told you that. do you guys have your gold yet? that once you bake u.s. senator, congratulations. one your clients becomes a foreign central bank. what would you tell foreign central banks who are large holders of the u.s. dollar, should they dump their dollar holders? >> of course i'm telling them do right now. >> you would tell foreign central banks to -- >> look, they shouldn't be buying treasury debt. look, i don't want the u.s. government going into debt. so i don't want foreign governments lending our government money. what is the government doing with the trillions of dollars that it's borrowing from abroad? it's using to undermine our economy. it's expanding government at the expense of the economy. it's undermining the free market.
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it's encouraging more reckless consumption. i want foreign enablers to cut us off. stop lending money to my government because they're going but right now they're putting road blocks. they're preventing the market from curing the problems, as they're making it worse. and they are setting up a major, major economic disaster. 2008 you know was the warmup. the main event is coming whether it's 2010 and 2011, but it's coming. and if no one in congress understands why, you know it's going to be a complete disaster. >> all right, peter, got wrap it here. >> all right, schiffforsenate.com. anybody lives in in connecticut
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to vote for me. i would get your vote but if you want to contribute to the campaign -- >> if you are out there. >> don't need no money. she's got more than i do. >> thank you, peter. time to answer a fast message. rob from forest hills, new york, asks -- >> i have never seen compared to anything but upbeat. i think ever since he sold his hedge fund to them, what's not to be upbeat about? >> he's taking bags in cash at night. >> exactly. >> i would too. >> it's the same thing i said earlier if you are going to play i would rather play in bank of america. i like the franchise better. >> all right. coming up next, foster wheeler, caterpillar, yahoo -- all up big at the close, but what is tomorrow's trade? today "pop ." stick around.
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welcome back to "fast money." we are live at the nasdaq market site in new york's times square. after-hours that is palm, right now it is down by just about 2%. it's earnings in the first quarter came in better than expected. outlook in the second quarter was disappointing and also
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should note it announced a 16 million share offering which would explain the pressure on that stock. lower forecast for second quarter and a secondary. time now for today's edition of "pops & drops." kick it off with the drop. it was down 3%. tim? he despite season start numbers getting the data about the company's ceo selling their stocks it is really not a lot of enthusiasm for people to jump in behind? pop for you, yahoo! was up 3%. joe? >> yeah, completely defies logic. pressing 18 bucks. i have to ask karen for help on this one. karen, one of those names that we missed. do you feel bad that you missed it. >> i do not. never would had been along for the ride. >> there you go. >> drop for mcgraw-hill. down 4%. karen? somehow all of the rating agency, mcgraw-hill and mead's both down today. california investigating them 'a groundswell of people wondering why do we need them at all? not good for business. >> pete. >> a strong upgrade from a buy from goldman sachs today. their margins, speaking in the conference, everything sounds like clicking along for them. couple acquisitions, about three of them. that's a growth stock. >> and we've got a pop here for
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bump passengers. the number of travelers apparently getting bumped from their flights. is that a 14-year high, up 40% a year ago -- from a year ago as airlines cut capacity and looked to fill seats, according to the department of transportation us airways bumped up the highest rate at almost 2%? >> lovely. >> while jetblue barely bumped at all. >> how much, $2.9 billion today. >> $2.9 billion. nowhere in that bump passenger's meter. we've got to move on here. to a drop for arsenal mittal. >> a big downgrade today. that's really the story. a great run for steel. i don't think that you need to jump in here but i think that you buy this thing around 35. >> a pop for caterpillar, up 2%, joe? >> a sweet spot for caterpillar. the ism is north of 50. has dane great job navigating
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the weight, cutting the bottom line. caterpillar looks good. looks like it will go to 55 now. >> a drop here for the rolls-royce. if ever a end. called the ghost selling for just $245 grand. >> that's all? >> it's a third of the price of the flagship phantom car. the company says it's seeing strong demand and expects to sell 2,000 ghost models annually. by the way the chairwoman pointed this out, because she's probably listening. >> why would you buy the cheapest one? i mean i don't get the whole thing. i wouldn't want any of them. no. >> why. >> i have a minivan. i've got four kids. >> come on. >> the bottom line you need two. the old saying is. coming up next, unions bad for stocks? the chairwoman put one of union's leaders to the test. next in an exclusive interview.
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wall street and unions typically stand on the opposite sides of the trade. investors view organized labor as tough on pay, tough on benefits and therefore, tough on their bottom line. the chairwoman caught up with
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president of the international brotherhood of teamsters in las vegas. are unions good for shareholders? >> absolutely. we're out there making sure that they have very, very fair and good conditions for their workers. how can we maybe make the work rules different to produce cars more productively without sacrificing good wages and health care? >> he blames wall street as the biggest threat to long-term economic prosperity. >> greed, basically depression, all the things that came out of wall street, the great crash was horrible, all because of wall street. >> many situations back the notion that more organized labor leads to bigger investment losses. shares of the single largest employer in the teamster's union, ups, has underperformed fedex for years and they're
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toughening their stance. >> why have two standards for two identical companies? we'll be able to organize thousands of fedex workers. >> this change may be coming to lots of stocks if they're able to pass the employee free choice act. >> it's basically card check. if you get a majority of people signed up just like canada and other democracies in the world have card check and it works everywhere. >> who is your biggest enemy? >> right now it's the right wing, it's big business. they don't want health care, they don't want employee free choice. they don't want anything. they want to roll the clock back to maybe 1901. >> with the union friendly president -- >> the white house is pretty nice, but there's nothing like being back in the house of labor. >> the debate could soon take
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center stage on main street. let's get the trade. all right, karen, how was he? how is mr. hoffa? >> it was great to meet him and it was interesting and the teamster women's conference was a kick. but support for the free choice act for card check does seem to be eroding. so that's something i think -- i asked him why should wall street like companies that have union labor? he says, i don't care what wall street likes. that was interesting. >> do you as an investor look as whether or not a company is unionized and think maybe that is not the company i want to invest in? >> walmart would be a potential target for them. it's a little concern but not a huge one. >> and why were you out there? >> i was speaking to the women's teamster's conference explaining what happened and then we did some workshops with them and i interviewed mr. hoffa. i really liked him.
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it was interesting to hear the other side of the story. >> great conversation. to catch the entire interview, go to our website. and tomorrow our interview with labor secretary hilda solis. final trade right after this. when this school district added aflac to complement their employee benefits package, guess who became the new teacher's pet? aflac, aflac, aflac, aflac, aflac find out more at... aflac! for business.com and the duck says... aflac! myth. head & shoulders is just for dandruff. myth. the fact is, it gives you... seven scalp and hair benefits including beautiful, 100% flake-free hair. respect the scalp. love the hair.
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how you could start saving.
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time now for the final trade. kick it off. >> you can buy this stock back around 1.70 and let it ride again. >> take a look at the uhn or the uga. that gives you exposure to reform lated gasoline and heating oil. >> pete? >> sticking with the oil. wnr. >> thanks so much for watching. see you back here 5:00 p.m. eastern time for more "fast money" on cnbc. spend 10 minutes a month with natural instincts. it's the healthier way to blend away gray. how? it's antioxidant rich and ammonia-free. in fact the more often you use it, the healthier your hair looks. natural instincts, it's all good.
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